Unfunded mandates, unnecessary oversight and incompatibility cited

Auburn, Calif. – The Placer County Board of Supervisors has passed a resolution to formally oppose Proposition 1, a measure on the March 5 statewide ballot that seeks voter approval of state-issued general obligation bonds that would provide more housing for the homeless and increase behavioral health treatment facilities. The board opposes the measure due to concerns that it would limit local control and flexibility over behavioral health services and reduce program funding to counties.

“The Placer County Board of Supervisors opposes Proposition 1 because it adds unfunded mandates, creates another expensive layer of bureaucracy and provides a solution for urban zones without considering the needs of rural counties,” said Board Chair and District 4 Supervisor Suzanne Jones. “Our Health and Human Services workers have their finger on the pulse of homelessness in Placer County and that is why we have a smaller unhoused population than most other counties in California.”

“Proposition 1 goes too far and dictates funding priorities that do not match our needs.”

Suzanne Jones, District 4 Supervisor

March Ballot

Proposition 1 was placed on the March 5 ballot to seek voter support for a two-bill legislative package that was signed by California Governor Gavin Newsom in October 2023. The first piece of legislation, Assembly Bill 531, would establish the Behavioral Health Infrastructure Bond Act of 2024, which would authorize $ 6.38 billion in general obligation bonds to finance the conversion, rehabilitation and construction of supportive housing and treatment facilities with the following stipulations on how the money is to be spent.

  1. Places for Mental Health Care and Drug or Alcohol Treatment
    $4.4 billion would be used to add more places for mental health care and drug or alcohol treatment with $1.5 billion of this allocation going to local governments and tribes for direct services.
  2. Housing
    $2 billion would be used by the state to turn hotels, motels and other buildings into housing. These funds would be used to award grants back to local governments to provide housing for people experiencing homelessness or at risk of becoming homeless. Of this allocation, $1 billion would be set aside specifically to assist veterans, who account for approximately 10,000 of California’s estimated 171,500 homeless population.

Significant changes

“The bond funding would only cover the cost to build housing infrastructure, leaving counties to assume the cost of operations with no additional funding,” said Placer County Legislative and Government Affairs Coordinator Joel Joyce during a presentation to the Board of Supervisors.

The state estimates the bond would build up to 4,350 housing units, with 2,350 set aside for veterans. The bond would provide housing to over 20% of veterans experiencing homelessness but meet only a fraction of the overall need in California.

The second piece of legislation, Senate Bill 326, amends the Mental Health Services Act that was passed by voters in 2004 and makes significant changes to the state’s behavioral health system. Among those changes is the renaming of MHSA to the Behavioral Health Services Act.

If Proposition 1 is approved, the BHSA would revise funding categories to prioritize supportive housing for those with the most severe needs, including the chronically homeless. SB 326 also expands eligibility to mental health programs for people who have a substance use disorder regardless of whether they also have a mental illness. The expansion of eligibility does not come with expanded funding.

“Incompatible with the county’s existing conditions”

“If passed, this proposition would force us to reduce existing mental health services to some of the most vulnerable residents in our community. It would implement a one-size-fits-all solution statewide that just doesn’t fit the smaller counties, like Placer,” said District 1 Supervisor Bonnie Gore. “SB 326 requires 50% of the housing funds be spent on the chronically homeless; however only 36% of our county’s unhoused population are considered chronic. These mandates are incompatible with the county’s existing conditions and would add unnecessary oversight.”

The county would need to divert approximately $5 million away from mental health and prevention services to increase its supportive housing program as required by Proposition 1. The changes would also reduce the county’s flexibility to use funds as prioritized by local planning and would increase workload to accommodate oversight and accountability measures.

Shift mental health funding away

If approved, Proposition 1 would also shift mental health funding away from counties and to the state. Currently, counties receive state and federal tax dollars of approximately $13 billion annually to provide mental health care and drug or alcohol treatment to people with low incomes and severe mental illness. Approximately one-third of this money comes from a 1% tax on people with incomes over $1 million per year. Presently, California counties receive 95% of this tax and the state receives 5%. This voter-approved tax has been in place since 2005 and Placer County has received an average of $16 million annually over the past decade.

Loss of county funding

If Proposition 1 is approved, the state would shift an additional 5% of the millionaire tax away from counties and to the state for a total of 10% – amounting to approximately $140 million annually with a loss to Placer County of approximately $1.16 million.

“My concern is that many residents will read Proposition 1 and see it as a good solution to helping people who are homeless without understanding that it will have a negative impact on our county’s mental health services,” said District 5 Supervisor Cindy Gustafson.

“We all agree there is a need to provide additional supportive housing but this is a poor solution and will end up costing more money to administer leaving less for actual programs and services.”

Cindy Gustafson, District 5 Supervisor
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